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Controversies Facing Hillary Clinton; 1,200 Acres, Some Homes Burn Near L.A.; Best Buy, JCPenney Rethinking Long-Term Strategy; John Kerry Statement on Syria; Nuclear Arsenal Scandal Rocks Pentagon

Aired January 16, 2014 - 13:30   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

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WOLF BLITZER, CNN ANCHOR: Three people are in custody in connection with a raging wildfire about 20 miles east of Los Angeles. Hundreds of firefighters are trying to stop the flames from spreading. People in Glendora have been evacuated. Schools in the area are closed. About 1700 acres are burning, all this according to L.A. County officials. Firefighters are battling this wildfire mostly from the air.

Here's what helicopter pilot, Larry Welk, had to say about trying to save some homes.

LARRY WELK, HELICOPTER PILOT: We understand that there are mandatory evacuations for some of these foothill areas here. We don't know that this was particularly one of them. However, by the -- you know, by the look of the fire here engulfing this house, it looks like this may be one of the areas considered for evacuations.

No, we don't see anyone in the House itself. We don't see anyone around the House other than that one firefighter we were able to spot a couple minutes ago here. Unfortunately, as you mentioned, this house is going to be a total loss. The roof has actually collapsed. The flame's very active at this point. As we move into a clear spot, we can get a great shot of this fire here. And it is unfortunately consuming this house from top to bottom, left to right. And that is certainly some unfortunate news of the residents of this place here. But that at the very least they were able to get out. And we hope firefighters are able to mitigate damage to some of the surrounding structures here and maintain some sort of order in the area here not allow this fire to spread beyond the border of this particular home.

Under the most intense conditions fires can generate their own weather patterns and so, having said that, I would guess that winds down at the surface are probably whipping around pretty good. I will say a couple of -- we're at 6,000 feet at this point, and I will say, at this point, the fire, the smoke from the fire is basically laying down, lingering at about the 4,000 to 5,000 foot mark here. And it is blowing a little bit less intensely.

For the moment the wind is starting to die out. I'm starting to look at some of the homes along just north of Palm Drive, just north of Rose Drive where some of the smoke just kind of lazily moving up. It looks like for the moment that the winds tend to be dying down. But we know from past experience that any shift in the wind or any change in the wind patterns can quickly kick this fire back up.

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BLITZER: Amazing, amazing pictures there. Officials plan to hold a news conference within the hour. We're going to bring you the new information as we get it. We expect to hear more about the three people who are now in custody as well.

Other news we're following, while Chris Christie has been dealing with the traffic scandal in New Jersey, Hillary Clinton hasn't exactly been flying under the radar. There were reports about her so-called enemies list. Our Peter Hamby did a great article on CNN.com about her potential problems in Iowa. And now she's the focus of "Time" magazine's cover story. The article is entitled, "Can Anyone Stop Hillary?

"Time" magazine's Washington chief, Michael Scherer, here with us right now.

Everything she seems to be doing, suggesting at least to a lot of us political reporters, she's already sort of campaigning. Is that the bottom line, the conclusion you guys have?

MICHAEL SCHERER, WASHINGTON BUREAU CHIEF, TIME MAGAZINE: Yeah. There's no incentive for her to announce a candidacy at this point. Hillary Clinton is one of those rare people who's day to day live and normal course of living looks a lot like a campaign. She travels the country for Global Initiative fundraisers and happens to be meeting with fundraisers for her campaign. She gives speeches at universities and happens to be laying out themes that would work very well in a campaign. She's writing a book right now, which will give her another book tour opportunity next year, which will be great for her campaign. So she's taking all the steps that she would need to take short of actually deciding.

BLITZER: A lot of Democrats really want her to run. They see this as an historic moment, potentially, a first woman president of the United States.

SCHERER: What's amazing right now in the Democratic Party is how little opposition there is from any corner. There's very few people, even far to her left, people who opposed her in 2007-2008 when she last ran who are saying anything negative about her and they're working to lobby her to take on their issues. Historically, you don't have uncontested primaries. It almost never happens. And it probably won't happen in her case. Someone will come forward, but she's basically as close to an uncontested primary, or looks that way, as she could possible be.

BLITZER: If she runs, what about Joe Biden? I'm sure he'd like to be president of the United States.

SCHERER: I think he would. He's a guy who's never not running for the next job, but I think his aides have made clear that if she does run he's probably not going to run.

BLITZER: He wouldn't challenge her, you don't think?

SCHERER: I don't think so.

BLITZER: People ask me -- they think I know but I don't know -- is Hillary going to run. I've always felt myself that she will run unless she's not healthy. She had that blood clot in her brain about a year or so ago. If she's healthy and she looks great right now, what do you find out on that front? Is she healthy enough to be president of the United States? She's 66 years old right now.

SCHERER: That's right. There was a serious health issue several years ago. I think there are still unanswered questions about exactly what happened during that time and her health now. But if you look at her schedule and the way she's been traveling the country, like I said, very similar to a campaign schedule. She kept an incredibly rigorous schedule as secretary of state. There are no signs that her health is holding her back right now. So barring some disclosure revelation that we don't know about yet, I think all signs are that she is.

BLITZER: Listen to Lindsey Graham, the Republican Senator from South Carolina, speaking about Hillary Clinton and the attack in Benghazi that killed four Americans earlier today.

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SEN. LINDSEY GRAHAM, (R), SOUTH CAROLINA: Well, I think if she wants to be commander-in-chief she has to answer for her leadership as secretary of state when it comes to Benghazi. She has a lot of accomplishments. She's a very accomplished woman. But under her leadership, the consulate became a death trap.

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BLITZER: All right. So what about that? Because on the Republican side, her critics, they clearly say she should take some of that responsibility for the disaster that occurred in Benghazi.

SCHERER: That's right. And she's going to keep hearing that. And what you see there Lindsey Graham's running for re-election right now. It's good for Republicans to talk about Hillary Clinton right now. So they're going to keep talking about it and she's going to have to deal with it. I think a big part of her book and her book tour when it comes out will be dealing head-on with this issue so she can try and get it out of the way before the campaign.

BLITZER: Her book is coming out this year. So she basically is doing what Robert Gates has now done, publish a book while the sitting president remains in office. I assume she's going to be writing about her time as secretary of state.

SCHERER: We'll see if it's as tell-all as Robert Gates.

BLITZER: What do you think?

SCHERER: I'd guess not. There's a great political alliance formed right now between Hillary Clinton and Barack Obama. A lot of people who are moving towards running her campaign, running the organizations on the outside of her campaign -- outside of the official campaign right now are former Obama people. So there's a real potential for a unifying effect here. I doubt she will take too many --

BLITZER: On the other hand, Republicans probably want her to. Give us some dirt. Tell us what was really going on in those meetings leading up to the, what, the killing of bin Laden or whatever. Take us inside that situation room.

SCHERER: I doubt a call from a publisher that would change Hillary Clinton's strategy.

BLITZER: Her book would be a little more tame, is that what you're saying?

SCHERER: That's right. I'm sure there will be news in it, but not of the sort that was in the Gates book.

BLITZER: Do you know who's going to be in "The Situation Room" today?

SCHERER: No, I don't.

BLITZER: Robert gates. We're going to have an extensive live conversation with the former secretary, 5:00 p.m. eastern --

SCHERER: I'll be watching.

BLITZER: -- in "The Situation Room."

Thanks very much, Michael, for that good article. We'll read more in "Time" magazine.

Some not so great retail news. A couple of well-known stores are rethinking their long-term strategy. We'll see what ripple effects are being felt on Wall Street in just a moment.

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BLITZER: Some big retail news today. Best Buy and JCPenney didn't have quite the holiday season they expected.

Our own Zain Asher joining us from the New York Stock Exchange.

Zain, tell us what's going on with these huge big retailers and how it's impacting Wall Street.

ZAIN ASHER, CNN BUSINESS CORRESPONDENT: Hey, Wolf. It's been pretty much a bad day for JCPenney and Best Buy. JCPenney down about 3 percent right now on the word of store closures. I mean, this is a company that really has been bleeding money. So Wall Street taking the store closures as certainly a bad sign.

Also want to talk about Best Buy because they are having an even worse day. Their shares are down 28 percent right now. And the volume, Wolf, is particularly high. That means it's not just a few people sort of selling here and there. You have a lot of people selling those shares. It's partly because of holiday sales. Holiday sales fell .8 percent this holiday season. It doesn't sound huge, and it really isn't, but Wall Street expected an increase. So that's where the shock is coming from.

Take a look at the trajectory Best Buy has been on over the past few years. They declined in 2011 and 2012, but 2013 was sort of a turnaround for them. In fact, they were the second-best performing stock in the S&P 500. And so now they're trying to restructure. They've got a new CEO, but this past holiday season has certainly been full with problems, fewer customers and heavy discounting as well -- Wolf?

BLITZER: Zain, thanks very much.

Zain Asher reporting.

ASHER: Of course.

BLITZER: Meanwhile, more water troubles in West Virginia. The chemical company responsible for contaminating the water supply is now getting cited for additional violations at a second storage site. An EPA report says Freedom Industries had five violations, one of them for not having adequate spill prevention barriers. Meantime, a new advisory is being issued in the nine counties affected by the chemical leak. State health officials say pregnant women should avoid drinking tap water until they are absolutely no detectable levels of contamination. Officials also say the decision is based on guidance from the CDC and is being made out of an abundance of caution. The "do not use" order for the tap water also remains in effect for about 150,000 people within the so-called leak zone.

Not having clean water is a daily reality for millions of people around the world. That's something one movie star wants to change.

Our own Chris Cuomo shows us how Matt Damon is impacting our world.

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CHRIS CUOMO, CNN ANCHOR, NEW DAY (voice-over): This celebration in India has a very special guest, Matt Damon. But the Oscar-winning actor isn't the big news of the day. The new water pump is stealing the spotlight. And Damon's charity made it happen. Water.org helps bring water and sanitation to those in need.

MATT DAMON, ACTOR: Water really underpins everything. Every 20 seconds, a child dies because they lack access to clean water and sanitation. Every 20 seconds.

CUOMO: This hits home for Damon, who has four daughters.

DAMON: Once you have kids, it's impossible not to see their face in every child you see.

CUOMO: Water.org provides small loans to help people get access to water. DAMON: People were paying money for water already. Sometimes 15, 20 times what you or I pay for our water, right, to a local water mafia. If you can just front them the money to connect to the municipality, so if you'd give them their time back so they could work at their job and pay the loan off. They are now in control of their destiny in a way that they weren't. So it's not only about the millions of children who actually die every year, it's about the quality of life that somebody can have if they have access to clean water.

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BLITZER: A cheating scandal rocks the Pentagon and involves almost three dozen U.S. Air Force officers in charge of maintaining the country's nuclear weapons and just the latest in a string of problems. We have the story straight ahead.

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BLITZER: An Ohio prison has been put to death using a combination of a pain killer, a new protocol Ohio is using. The European manufacturer of the old drug banned the use by U.S. prisons. Critics insist the new drugs will cause cruel and agonizing deaths. Witnesses to his execution say it took him more than 15 minutes to die.

They are in charge of maintaining the nation's arsenal of weapons. But some of those military officers have been plagued by scandals, and many recently. The latest involves cheating at the air base in Montana. 34 officers have been implicated in the incident has rocked the Pentagon.

Brian Todd is looking into all of this for us.

It's not just this incident, but a bunch of these very worrisome incidents.

BRIAN TODD, CNN CORRESPONDENT: You are talking about nearly three dozen officers at this one Air Force base in Montana being caught cheating. Some cheated out right. Others knew about the cheating but didn't report it. That may not be reported so heavily on a given day normally, but it's on the heels of several scandals rocking specifically America's nuclear arsenal. Last year, two nuclear arsenal units failed safety inspections. Also last year -- we reported this a few weeks ago -- General Michael Kerry, a top general enforcing the rules and overseeing the nuclear arsenal, one of the nuclear arsenals, was removed from the post for womanizing and going on a drinking binge and an unofficial trip to Russia. Right before that, another, a vice admiral was removed from the post for allegedly using counterfeit chips at a casino. We have various reports of morale problems. It's much deeper below the surface and leads you to question whether the arsenal is safe.

That was raised yesterday at a briefing where Deborah Lee James, the secretary of the Air Force, weighed in. She was asked, given all these problems, is the arsenal safe? Here's what she had to say.

(BEGIN VIDEO CLIP) DEBORAH LEE JAMES, SECRETARY OF THE AIR FORCE: I want all of you to know, based on everything we know today, I have great confidence in the effectiveness of our ICBM force. And very importantly, I want you to know that this was a failure of some of our air men. It was not a failure of the nuclear mission.

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TODD: The officers involved in that cheating scandal have been removed or no longer able to conduct nuclear operations. But again, a lot of questions about the arsenal and the people manning them. Are they doing OK or is the morale good? There may be problems there.

BLITZER: Brian Todd, thanks very much.

The Secretary of State John Kerry has now walked into the briefing room at the State Department to speak about Syria.

JOHN KERRY, SECRETARY OF STATE: -- more clear at the time this was announced, and it cannot be more clear today, it has been reiterated in international statement after international statement that the parties have signed up too, in venue after venue, in resolution after resolution, including most recently in Paris last weekend when both the London 11 and the Russian Federation reaffirmed their commitment to that objective, the implementation of Geneva One. So for anyone seeking to rewrite this history or to muddy the waters, let me state one more time what Geneva Two is about. It is about establishing a process essential to the formation of transition government body, governing body with full executive powers established by mutual consent. That process is the only way to bring about an end to the civil war that has triggered one of the planet's most severe humanitarian disasters, which has created the seeding grounds for extremism.

The Syrian people need to be able to determine the future of their country. Their voice must be heard. And any names put forward for leadership of a serious transition must, according to the terms of Geneva One, and every one of the reiterations of that being the heart and soul of Geneva Two, those names must be agreed to by both the opposition and the regime. That is the very definition of mutual consent. This means that any figure that is deemed unacceptable by either side, whether President Assad or a member of the opposition, cannot be a part of the future.

The United Nations and the United States, Russia and all the countries attending know what this conference is about. After all, that was the basis of the U.N. invitation sent individually to each country, a restatement of the purpose of implementing Geneva One and attendance by both sides of the parties can come only with acceptance of the goals of the conference.

We, too, are deeply concerned about the rise of extremism. The world needs no reminder that Syria has become the magnet for jihadists and extremists. It is the strongest magnet for terror for anyplace today. So it defies logic to imagine that those whose brutality created this magnet, how they could ever lead Syria away from extremism and towards a better future is beyond any kind of logic or common sense.

And so on the eve of the Syrian opposition coalition General Assembly meeting to decide whether to participate in Geneva in the peace conference, the United States, for these reasons, urges a positive vote. We do so knowing that the Geneva peace conference is not the end, but rather the beginning, the launch of a process, a process that is the best opportunity for the opposition to achieve the goals of the Syrian people and the revolution and the political solution to this terrible conflict that has taken many, many, many, too many lives.

We will continue to push in the meantime for vital access for humanitarian assistance. I talked yesterday with Russian Federation foreign minster Lavrov in an effort to push still harder for access to some areas where the regime played games of the convoys, taking them around a circuitous route instead of directly in the way that the opposition had arranged for and was willing to protect them. It was important there be no games played with the process. And we will continue to fight for ceasefires where we could achieve them and continue to fight for the exchange or the release of captive journalists and aid workers and others in order to try to improve the climate for negotiations.

Obviously, none of this will be easy. Ending a war and stopping a slaughter never is easy. We believe, though, this is the only road that can lead to the place where the civilized world is joined together in an effort to lead the parties to a better outcome.

And to the Syrian people, let me reiterate the United States and the international community will continue to provide help and support as we did yesterday in Kuwait where we pledged $380 million of assistance to relieve the pain and suffering of the refugees. We will stand with the people of Syria, writ large, all the people, in an effort to provide them with the dignity and the new Syria which they are fighting for.

Thank you.

And as I said, I would be happy to answer questions tomorrow. Thanks.

BLITZER: There you see a strong statement from the Secretary of State John Kerry on Syria, urging the opposition to the regime to show up at these meetings, these negotiations that he describes as the Geneva One framework, bringing together all sorts of parties to see if they can come up with some sort of other leaders to emerge. Whether or not the regime of Bashar al Assad would ever agree to anything along those lines remains very much up in the air. But you see a relatively angry secretary of state, saying there is an opportunity right now to bring these parties together in Geneva and he hopes they take advantage of this opportunity.

We will have much more on this story throughout the day here on CNN and in "The Situation Room" later today, 5:00 eastern, I'll talk about it and other subjects with the former Secretary Robert Gates.

That's it for me. Thanks very much for watching.

NEWSROOM continues right now with Brooke Baldwin.

BROOKE BALDWIN, CNN ANCHOR: Thank you so much, Wolf Blitzer.